q3 results and q4 forecasts22.q4cdn.com/.../2019/q3/final-q3-19-shareholder-letter.pdfoctober 16,...
TRANSCRIPT
October 16, 2019
Fellow shareholders,
In Q3, we grew to $5.2 billion in revenue, up 31% over the prior year, and operating income doubled to
$1.0 billion. Paid net adds totaled 6.8m compared to our 7.0m forecast and prior year Q3 of 6.1m. As
we’ve improved the variety, diversity and quality of our content slate, member engagement has grown,
revenue has increased, and we’re able to further fund our content investment.
Q3 Results and Q4 Forecast In Q3’19, average streaming paid memberships and ARPU grew 22% and 9% year over year, respectively.
Excluding a -$137m year over year impact from F/X, consolidated revenue growth was 35%, while
streaming ARPU growth was 12%. Operating margin of 18.7% (up 670 bps year over year) was above our
guidance due to timing of content and marketing spend, which will be more weighted to Q4’19. EPS
amounted to $1.47 vs. $0.89 and included a $171 million non-cash unrealized gain from F/X
remeasurement on our Euro denominated debt. Our Euro bonds provide us with a small natural hedge
for our growing European revenues.
Total paid net adds of 6.8m increased 12% year over year and was an all-time Q3 record. As a reminder,
the quarterly guidance we provide is our actual internal forecast at the time we report and we strive for
accuracy. In Q3, our guidance forecast was our most accurate in recent history.
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In the US, paid net adds totaled 0.5m in Q3 vs. our 0.8m forecast, and year to date paid net adds are
2.1m vs. 4.1m in the first nine months of 2018. Since our US price increase earlier this year, retention
has not yet fully returned on a sustained basis to pre-price-change levels, which has led to slower US
membership growth. On a member base of more than 60m, very small movements in churn can have a
meaningful impact on paid net adds. However, revenue growth has been accelerating as US ARPU
increased 16.5% year over year in Q3. With more revenue, we’ll continue to invest to improve our
service to further strengthen our value proposition.
International paid net additions totaled 6.3m in Q3, a 23% increase vs. 5.1m in the year ago quarter, and
slightly above our 6.2m guidance forecast. The US dollar strengthened vs. several key currencies over
the course of the quarter, which resulted in the variance between our forecasted vs. actual international
revenue. International ARPU, excluding the impact of F/X, rose 10% year over year. We’re making strides
in our key markets and, while we have much more work to do in Asia in the coming years, we are seeing
encouraging signs of progress.
For Q4, we’re expecting consolidated revenue to increase 30% year over year with 9% streaming ARPU
growth. We’re forecasting 7.6m global paid net adds (vs. 8.8m last Q4), with 0.6m in the US and 7.0m for
the international segment. This implies full year 2019 paid net adds of 26.7m, down from 28.6m last
year. While we had previously expected 2019 paid net adds to be up year over year, our current forecast
reflects several factors including less precision in our ability to forecast the impact of our Q4 content
slate, which consists of several new big IP launches (as opposed to returning seasons), the minor
elevated churn in response to some price changes, and new forthcoming competition. As we outline in
more detail below, our long term outlook on our business is unchanged.
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We’re on track to achieve our full year 2019 operating margin goal of 13%. In 2020, we’ll be targeting
another 300 basis points in operating margin expansion, consistent with the annual margin
improvement we’ve delivered each year since 2017. As we’ve said previously, large swings in F/X could
lead to some variations from our steady annual margin progression, partially because we don’t buy
derivatives to hedge our F/X exposure and about half of our revenue is not in US dollars.
Content
We strive to program Netflix with the best variety of high quality content across many genres (scripted
series, films, docs, comedy specials, unscripted TV, kids & family, anime, etc.). Our ambitious approach
reflects our goal to satisfy the entertainment desires of our 158m-plus members and to attract as many
of the hundreds of millions of non-members as we can. To accomplish this, we need great breadth of
quality content because people have very diverse tastes.
If you think about your own habits, you’ll recognize that what you want to watch on a Friday night may
differ from what you want to watch on Tuesday after a long day of work or what you want to watch with
your family on Saturday morning or what you want to watch with your friends on Sunday afternoon.
Now, multiply that by the billions of people on the planet and all the other factors that affect viewing
preferences and you will have a sense of the breadth of programming necessary to be as successful as
we desire.
We have been moving increasingly to original content both because of the anticipated pullback of
second run content from some studios and because our original content is working in the form of
member viewing and engagement. We started first with English scripted TV series more than six years
ago to great success. We continued in Q3 with Stranger Things Season 3 (the most watched season to
date with 64m member households in its first four weeks). We also introduced new limited series like
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Unbelievable, one of our most thought provoking and highly viewed dramas (watched by 32m member
households in its first 28 days).
We’re expanding our non-English language original offerings because they continue to help grow our
penetration in international markets. In Q3, Season 3 of La Casa de Papel (aka Money Heist) became the
most watched show on Netflix across our non-English language territories with 44m households
watching the new season in the first four weeks of release. Sintonia, our latest Brazilian original, was the
second most watched inaugural season in Brazil. The Naked Director broke out as the biggest title launch
for us in Japan and was also highly successful throughout Asia. Similarly, in India, we debuted the second
season of Sacred Games, our most watched show in India. To date, we have globally released 100
seasons of local language, original scripted series from 17 countries and have plans for over 130 more in
2020. We also plan to expand our investment in local language original films and unscripted series.
We’re also investing aggressively in original films and making great progress with improving results. Our
original film slate in Q3 featured several solid hits like Secret Obsession (starring Brenda Song) and
Otherhood (directed by Cindy Chupack in her feature directorial debut), which were watched by 40
million and 29 million households in their first four weeks, respectively. Tall Girl, a new family film
starring Ava Michelle, was also a success with 41m households watching in the first 28 days. We expect
that our Q4 film releases will continue to build and strengthen our film effort. Q4 film releases include
Martin Scorsese’s The Irishman (with Robert De Niro, Al Pacino, and Joe Pesci), Marriage Story (starring
Scarlett Johansson and Adam Driver) and The Two Popes (featuring Anthony Hopkins and Jonathan
Pryce), all of which have emerged as early Oscar frontrunners. We also have several big releases such as
Dolemite is My Name (starring Eddie Murphy and featuring a breakout performance from Da'Vine Joy
Randolph), 6 Underground (directed by Michael Bay and starring Ryan Reynolds), The Laundromat, from
director Steven Soderbergh and starring Meryl Streep and Gary Oldman and The King (starring Timothée
Chalamet, Lily-Rose Depp and Joel Edgerton) as well as animated features Klaus and I Lost My Body.
Our goal is to have the quality of our slate rival the ambition of its scope. An example is Orange is the
New Black, which wrapped its final new season in Q3. The show was celebrated by fans and the media
for the groundbreaking role it played for Netflix and the culture at large; Time Magazine said
“...’Orange is the New Black’ is the most important TV show of the decade.” Our very popular Ozark,
Our Planet, Queer Eye, Black Mirror: Bandersnatch and When They See Us led 40 Netflix original series
and films to a record 117 Emmy Nominations and 27 wins in 2019.
With so many firms now looking to provide premium video content to consumers, it’s a great time to be
a creator of content. Amazing content can be expensive. We don’t shy away from taking bold swings if
we think the business impact will also be amazing. We don’t close every deal we chase and we don’t
chase every deal on the table. And while not all projects that we do pursue will work out, our large and
growing subscription base helps enable us to try many approaches, while the size of our content budget
(~$10 billion on P&L spend and ~$15 billion in cash content spend in 2019) insulates us from
dependency on any single title. We’ll continue to learn as we go, while staying disciplined by assessing
each opportunity individually, steadily marching up our operating margin and improving free cash flow.
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Product and Partnerships
We seek to make it easier for future members to sign up and enjoy Netflix. To that end, we rolled out a
lower priced mobile plan in India in July and we’re pleased with the results. Our approach with pricing is
to grow revenue and so far, uptake and retention on our mobile plan in India has been better than our
initial testing suggested. This will allow us to invest more in Indian content to further satisfy our
members. While still only a very small percentage of our total subscriber base, we’re continuing to test
mobile-only plans in other markets.
We continued to expand our partner-based bundle offerings, adding bundles with Sky Italia, Canal+ in
France, KDDI in Japan and Izzi in Mexico this quarter. We just localized our service in Vietnamese,
Hungarian and Czech so that more entertainment fans can enjoy thousands of hours of TV shows and
films in their preferred language. We’ll continue to expand language coverage and accessibility.
Competition
We compete broadly for entertainment time. This means there are many competitive activities to Netflix
(from watching linear TV to playing video games, for example). But there is also a very large market
opportunity; today we believe we’re less than 10% of TV screen time in the US (our most mature
market) and much less than that in mobile screen time. Many are focused on the “streaming wars,” but
we’ve been competing with streamers (Amazon, YouTube, Hulu) as well as linear TV for over a decade.
The upcoming arrival of services like Disney+, Apple TV+, HBO Max, and Peacock is increased
competition, but we are all small compared to linear TV. While the new competitors have some great
titles (especially catalog titles), none have the variety, diversity and quality of new original programming
that we are producing around the world.
The launch of these new services will be noisy. There may be some modest headwind to our near-term
growth, and we have tried to factor that into our guidance. In the long-term, though, we expect we’ll
continue to grow nicely given the strength of our service and the large market opportunity. By way of
example, our growth in Canada, where Hulu does not exist, is nearly identical to our growth in the US
(where Hulu is very successful at about 30 million paid memberships). Our penetration in both markets
below:
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We believe this is due to the big factor of streaming growing into linear TV plus the fact that streaming
video services have mostly exclusive content libraries that make them highly differentiated from one
another. In our view, the likely outcome from the launch of these new services will be to accelerate the
shift from linear TV to on demand consumption of entertainment. Just like the evolution from broadcast
TV to cable, these once-in-a-generation changes are very large and open up big, new opportunities for
many players. For example, for the first few decades of cable, networks like TBS, USA, ESPN, MTV and
Discovery didn’t take much audience share from each other, but instead, they collectively took audience
share from broadcast viewing.
Content creation is booming around the world and everyone is vying for consumer attention. Over the
next 10 years, many streaming services will grow viewing as streaming replaces linear TV. Our focus will
continue to be on pleasing our members and growing engagement because that approach has served us
well since 1997. Total viewing, as measured by various 3rd parties, is the best indicator of our relative
success since it’s a signal of customer satisfaction, and few of the services will disclose streaming video
revenue, and subscriber figures are hard to interpret (given bundles, discounts and other promotions).
Our focused approach to date has driven meaningful growth in our membership base and engagement.
We did well during the first decade of streaming. We’ve been preparing for this new wave of
competition for a long time. It’s why we started investing in originals in 2012 and expanded aggressively
ever since - across programming categories and countries with an ambition to share stories from the
world to the world. In Q4, with The Crown, The Witcher, Klaus, The Irishman, The Two Popes, 6
Underground, and many other amazing titles launching, we’re ready to compete to earn consumers’
attention and viewing.
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Cash Flow and Capital Structure Net cash used in operating activities in Q3’19 was -$502 million vs. -$690 million in the prior year period.
Free cash flow in Q3 totaled -$551 million vs. -$859 million in Q3’18. For the full year 2019, we’re still 1
expecting FCF of approximately -$3.5 billion. With our quickly growing revenue base and expanding
operating margins, we will be able to fund more of our content spending internally. As a result, we’re
expecting free cash flow to improve in 2020 vs. 2019 and we expect to continue to improve annually
beyond 2020. As we move slowly toward FCF positive, our plan is to continue to use the high yield
market in the interim to finance our investment needs.
Next Year Reporting Starting with our Q4’19 earnings report in January 2020, we plan to disclose revenue and membership
by region, which is how we think about our business. Our four regions are Asia Pacific (APAC), Europe,
Middle East & Africa (EMEA), Latin America (LATAM), and the US and Canada (UCAN). UCAN is roughly
90% US and 10% Canada. Under this new reporting format, we’ll only provide membership guidance for
global paid memberships for the next quarter with each earnings report.
As we self-produce and license more original content that has global rights, we are finding US vs.
international segment contribution margin reporting is becoming less useful internally. We’ll stop
reporting on it in January 2020 and continue to focus on global operating margin as our primary
profitability metric. As a reminder, we’ll no longer report free trial members beginning in 2020 as we
informed you in our Q3’18 investor letter.
1 For a reconciliation of free cash flow to net cash (used in) operating activities, please refer to the reconciliation in tabular form on the attached unaudited financial statements and the footnotes thereto.
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Reference For quick reference, our eight most recent investor letters are: July 2019, April 2019, January 2019, October 2018, July 2018, April 2018, January 2018, October 2017.
October 16, 2019 Earnings Interview, 3pm PDT Our video interview with Michael Morris of Guggenheim Securities will be on youtube/netflixir at 3pm
PDT today. Questions that investors would like to see asked should be sent to
[email protected]. Reed Hastings, CEO, Spence Neumann, CFO, Ted Sarandos,
Chief Content Officer, Greg Peters, Chief Product Officer and Spencer Wang, VP of IR/Corporate
Development will all be on the video to answer Michael’s questions.
IR Contact:
Spencer Wang
VP, Finance/IR & Corporate Development
408 809-5360
PR Contact:
Richard Siklos
VP, Communications
408 540-2629
Use of Non-GAAP Measures
This shareholder letter and its attachments include reference to the non-GAAP financial measure of free
cash flow and adjusted EBITDA. Management believes that free cash flow and adjusted EBITDA are
important liquidity metrics because they measure, during a given period, the amount of cash generated
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that is available to repay debt obligations, make investments and for certain other activities or the
amount of cash used in operations, including investments in global streaming content. However, these
non-GAAP measures should be considered in addition to, not as a substitute for or superior to, net
income, operating income, diluted earnings per share and net cash provided by operating activities, or
other financial measures prepared in accordance with GAAP. Reconciliation to the GAAP equivalent of
these non-GAAP measures are contained in tabular form on the attached unaudited financial
statements.
Forward-Looking Statements
This shareholder letter contains certain forward-looking statements within the meaning of the federal
securities laws, including statements regarding pricing; investments in our service; future content
offerings and approach to accessing content; investment in local language original films and unscripted
series; evolution of streaming video services; product tests and changes; impact of and reaction to
competition; future capital raises; U.S. and international streaming paid memberships, paid net
additions, revenue, contribution profit (loss) and contribution margin; consolidated revenue, revenue
growth, operating income, operating margin, net income, and earnings per share; free cash flow; and
changes to earnings reports. The forward-looking statements in this letter are subject to risks and
uncertainties that could cause actual results and events to differ, including, without limitation: our
ability to attract new members and retain existing members; our ability to compete effectively;
maintenance and expansion of device platforms for streaming; fluctuations in consumer usage of our
service; service disruptions; production risks; actions of Internet Service Providers; and, competition,
including consumer adoption of different modes of viewing in-home filmed entertainment. A detailed
discussion of these and other risks and uncertainties that could cause actual results and events to differ
materially from such forward-looking statements is included in our filings with the Securities and
Exchange Commission, including our Annual Report on Form 10-K, filed with the Securities and Exchange
Commission (“SEC”) on January 29, 2019, as amended by Form 10-K/A, filed with the SEC on February 8,
2019. The Company provides internal forecast numbers. Investors should anticipate that actual
performance will vary from these forecast numbers based on risks and uncertainties discussed above
and in our Annual Report on Form 10-K, as amended by Form 10-K/A. We undertake no obligation to
update forward-looking statements to reflect events or circumstances occurring after the date of this
shareholder letter.
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10
Netflix, Inc.
Consolidated Statements of Operations (unaudited) (in thousands, except per share data)
Three Months Ended Nine Months Ended
September 30,2019
June 30,2019
September 30,2018
September 30,2019
September 30,2018
Revenues $ 5,244,905 $ 4,923,116 $ 3,999,374 $ 14,689,013 $ 11,607,500
Cost of revenues 3,097,919 3,005,657 2,531,128 8,974,190 7,234,138
Marketing 553,797 603,150 510,330 1,773,525 1,639,114
Technology and development 379,776 383,233 308,620 1,135,773 890,025
General and administrative 233,174 224,657 168,628 659,783 454,764
Operating income 980,239 706,419 480,668 2,145,742 1,389,459
Other income (expense):
Interest expense (160,660) (152,033) (108,862) (448,222) (291,686)
Interest and other income (expense) 192,744 (53,470) 7,004 215,378 9,289
Income before income taxes 1,012,323 500,916 378,810 1,912,898 1,107,062
Provision for (benefit from) income taxes 347,079 230,266 (24,025) 632,952 29,754
Net income $ 665,244 $ 270,650 $ 402,835 $ 1,279,946 $ 1,077,308
Earnings per share:
Basic $ 1.52 $ 0.62 $ 0.92 $ 2.93 $ 2.48
Diluted $ 1.47 $ 0.60 $ 0.89 $ 2.83 $ 2.39
Weighted-average common shares outstanding:
Basic 438,090 437,587 435,809 437,547 435,033
Diluted 451,552 452,195 451,919 451,896 451,283
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Netflix, Inc.
Consolidated Balance Sheets (unaudited) (in thousands)
As of
September 30,2019
December 31,2018
Assets
Current assets:
Cash and cash equivalents $ 4,435,018 $ 3,794,483
Current content assets, net — 5,151,186
Other current assets 892,740 748,466
Total current assets 5,327,758 9,694,135
Non-current content assets, net 23,234,994 14,960,954
Property and equipment, net 481,992 418,281
Other non-current assets 1,896,967 901,030
Total assets $ 30,941,711 $ 25,974,400
Liabilities and Stockholders' Equity
Current liabilities:
Current content liabilities $ 4,860,542 $ 4,686,019
Accounts payable 444,129 562,985
Accrued expenses and other liabilities 1,037,723 477,417
Deferred revenue 915,506 760,899
Total current liabilities 7,257,900 6,487,320
Non-current content liabilities 3,419,552 3,759,026
Long-term debt 12,425,746 10,360,058
Other non-current liabilities 977,008 129,231
Total liabilities 24,080,206 20,735,635
Stockholders' equity:
Common stock 2,677,972 2,315,988
Accumulated other comprehensive loss (41,246) (19,582)
Retained earnings 4,224,779 2,942,359
Total stockholders' equity 6,861,505 5,238,765
Total liabilities and stockholders' equity $ 30,941,711 $ 25,974,400
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Netflix, Inc.
Consolidated Statements of Cash Flows (unaudited) (in thousands)
Three Months Ended Nine Months EndedSeptember 30,
2019June 30,
2019September 30,
2018September 30,
2019September 30,
2018
Cash flows from operating activities:
Net income $ 665,244 $ 270,650 $ 402,835 $ 1,279,946 $ 1,077,308
Adjustments to reconcile net income to net cash used in operatingactivities:
Additions to streaming content assets (3,648,292) (3,325,103) (3,238,717) (9,971,141) (9,259,185)
Change in streaming content liabilities (95,548) (12,414) 65,868 (122,660) 733,227
Amortization of streaming content assets 2,279,977 2,231,915 1,911,767 6,636,578 5,478,428
Amortization of DVD content assets 6,654 7,656 9,959 22,819 32,247
Depreciation and amortization of property, equipment andintangibles 26,704 25,496 21,161 75,761 59,938
Stock-based compensation expense 100,262 103,848 82,316 305,310 231,943
Other non-cash items 51,280 53,039 8,962 141,518 31,092
Foreign currency remeasurement loss (gain) on long-term debt (171,360) 61,284 (7,670) (167,676) (52,000)
Deferred taxes 52,105 35,519 (39,453) 94,251 (71,041)
Changes in operating assets and liabilities:
Other current assets 145 (24,231) (30,364) (56,162) (111,833)
Accounts payable (7,643) (2,674) (4,449) (134,784) 77,367
Accrued expenses and other liabilities 260,872 (26,705) 134,000 391,814 200,198
Deferred revenue 22,729 84,085 18,983 154,607 98,101
Other non-current assets and liabilities (44,923) (26,119) (25,609) (75,528) 28,803
Net cash used in operating activities (501,794) (543,754) (690,411) (1,425,347) (1,445,407)
Cash flows from investing activities:
Acquisition of DVD content assets (4,634) (7,798) (7,731) (21,602) (31,079)
Purchases of property and equipment (45,333) (39,584) (39,333) (145,298) (103,826)
Change in other assets 613 (2,654) (121,630) (12,593) (123,857)
Net cash used in investing activities (49,354) (50,036) (168,694) (179,493) (258,762)
Cash flows from financing activities:
Proceeds from issuance of debt — 2,243,196 — 2,243,196 1,900,000
Debt issuance costs — (18,192) — (18,192) (16,992)
Proceeds from issuance of common stock 11,989 21,896 29,781 56,857 113,052
Other financing activities — — (544) — (1,397)
Net cash provided by financing activities 11,989 2,246,900 29,237 2,281,861 1,994,663
Effect of exchange rate changes on cash, cash equivalents, andrestricted cash (29,325) 4,998 (5,562) (29,341) (34,725)
Net increase (decrease) in cash, cash equivalents, and restricted cash (568,484) 1,658,108 (835,430) 647,680 255,769
Cash, cash equivalents and restricted cash at beginning of period 5,028,205 3,370,097 3,913,994 3,812,041 2,822,795
Cash, cash equivalents and restricted cash at end of period $ 4,459,721 $ 5,028,205 $ 3,078,564 $ 4,459,721 $ 3,078,564
Three Months Ended Nine Months EndedSeptember 30,
2019June 30,
2019September 30,
2018September 30,
2019September 30,
2018
Non-GAAP free cash flow reconciliation:
Net cash used in operating activities $ (501,794) $ (543,754) $ (690,411) $ (1,425,347) $ (1,445,407)
Acquisition of DVD content assets (4,634) (7,798) (7,731) (21,602) (31,079)
Purchases of property and equipment (45,333) (39,584) (39,333) (145,298) (103,826)
Change in other assets 613 (2,654) (121,630) (12,593) (123,857)
Non-GAAP free cash flow $ (551,148) $ (593,790) $ (859,105) $ (1,604,840) $ (1,704,169)
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Netflix, Inc.
Segment Information (unaudited) (in thousands)
As of / Three Months Ended As of/ Nine Months Ended
September 30,2019
June 30,2019
September 30,2018
September 30,2019
September 30,2018
Domestic Streaming
Paid memberships at end of period 60,620 60,103 56,957 60,620 56,957
Paid net membership additions (losses) 517 (126) 998 2,134 4,147
Free trials 1,375 1,575 1,507 1,375 1,507
Revenues $ 2,412,598 $ 2,299,189 $ 1,937,314 $ 6,785,342 $ 5,650,555
Cost of revenues 1,210,105 1,196,420 1,038,473 3,546,060 2,944,948
Marketing 211,793 250,606 210,595 683,445 712,612
Contribution profit 990,700 852,163 688,246 2,555,837 1,992,995
International Streaming
Paid memberships at end of period 97,714 91,459 73,465 97,714 73,465
Paid net membership additions 6,255 2,825 5,070 16,941 15,631
Free trials 4,215 4,481 5,170 4,215 5,170
Revenues $ 2,760,430 $ 2,547,727 $ 1,973,283 $ 7,674,906 $ 5,676,513
Cost of revenues 1,860,021 1,778,890 1,455,554 5,336,032 4,169,772
Marketing 342,004 352,544 299,735 1,090,080 926,502
Contribution profit 558,405 416,293 217,994 1,248,794 580,239
Domestic DVD
Paid memberships at end of period 2,276 2,411 2,828 2,276 2,828
Free trials 16 17 24 16 24
Revenues $ 71,877 $ 76,200 $ 88,777 $ 228,765 $ 280,432
Cost of revenues 27,793 30,347 37,101 92,098 119,418
Contribution profit 44,084 45,853 51,676 136,667 161,014
Consolidated
Revenues $ 5,244,905 $ 4,923,116 $ 3,999,374 $ 14,689,013 $ 11,607,500
Cost of revenues 3,097,919 3,005,657 2,531,128 8,974,190 7,234,138
Marketing 553,797 603,150 510,330 1,773,525 1,639,114
Contribution profit 1,593,189 1,314,309 957,916 3,941,298 2,734,248
Other operating expenses 612,950 607,890 477,248 1,795,556 1,344,789
Operating income 980,239 706,419 480,668 2,145,742 1,389,459
Other income (expense) 32,084 (205,503) (101,858) (232,844) (282,397)
Provision for (benefit from) income taxes 347,079 230,266 (24,025) 632,952 29,754
Net income $ 665,244 $ 270,650 $ 402,835 $ 1,279,946 $ 1,077,308
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Netflix, Inc.
Non-GAAP Information(unaudited) (in thousands)
September 30,2018
December 31,2018
March 31,2019
June 30,2019
September 30,2019
Non-GAAP Adjusted EBITDA reconciliation:
GAAP net income $ 402,835 $ 133,934 $ 344,052 $ 270,650 $ 665,244
Add:
Other expense (income) 101,858 96,371 59,425 205,503 (32,084)
Provision for (benefit from) income taxes (24,025) (14,538) 55,607 230,266 347,079
Depreciation and amortization of property,equipment and intangibles 21,161 23,219 23,561 25,496 26,704
Stock-based compensation expense 82,316 88,714 101,200 103,848 100,262
Adjusted EBITDA $ 584,145 $ 327,700 $ 583,845 $ 835,763 $ 1,107,205